A private initiative to conclude a concession agreement is one of the most expected novelties in the sphere of implementation of concession projects. It lies in the fact that from may 2015, any potential party to a concession project may apply to the potential grantor the initiative on the implementation of the concession project. The feature of concession legislation and proposed amendments to the private initiative is that, on the one hand, the norms of the concession law are specialized and not available for understanding a wide range of investors who do not have experience of implementation of concession projects. On the other hand, not all issues related to private initiative regulated by law. Existing gaps in legislation leave room for interpretation as potential investors and potential grantor. The authors of this review give his expert evaluation of open questions of law based on practical experience of implementation of concession projects.
By order dated March 31 2015 No. 300 of the Government of the Russian Federation approved the form of a proposal to conclude a concession agreement with a person acting with the initiative to conclude a concession agreement (hereinafter the proposal Form). Recall that the adoption of the form required by paragraph 4.3 of article 37 of the new edition of the Federal law dated 21.07.2005 No. 115-FZ "On concession agreements" (hereinafter – FZ "On concession agreements") required for the practical implementation of private initiative.
Private initiative: short cut
The amendments made to the Federal law "On concession agreements" in July 2014[1], from may 2015, private investors can initiate the implementation of a concession project in relation to their interest objects of concession agreements are included in the list of part 1 of article 4 of the Federal law "On concession agreements". The initiator prepares and presents a potential grantor documents: the completed Form of proposal with all the documents confirming specified in the form information and draft concession agreement containing all essential terms listed in article 10 of the Federal law "On concession agreements".
Despite the ability of the initiator to act as a private initiative, the conclusion with it of the concession agreement without a tender is possible only when the following key conditions:
the adoption by the authorized body of the potential grantor of a positive decision in relation to the initiative;
adherence to competitive procedures by posting on the Internet RFP agreement proposed by the initiator and agreed to by the grantor;
the absence of the results of the request for proposals agreement wishing to conclude an agreement on the proposed terms.
The presence of the above limits does not deprive the private initiative mechanism advantages over the standard procedure of concluding concession agreement, which is expressed in:
the capabilities of the initiator alone to work out the terms of the concession agreement, taking into account its commercial interests;
more high-quality elaboration of project documentation through the use of resource potential of the concessionaire (financial and professional);
reducing the time to run the project (without competition time will be reduced by about half);
reducing the cost of preparation of projects for the state (grantor) through the assignment of expenses for pre-investment study of the project proponent.
Prior to the entry into force of the amendments on private initiative, less than a month, and approval by the Government of the Russian Federation Form of the proposal will allow the initiators to start the preparation of the first pilot projects implemented under the new procedure.
Form of proposal: a brief description
The form of the sentence partially duplicates the provisions of article 37 of the Federal law "On concession agreements" in terms of requirements to the proponent and the initiative (subparagraphs 4.3, 4.11), for example:
the absence of a decision on liquidation of the legal person – the initiator;
the absence of a court decision on initiation of proceedings on bankruptcy in respect of the initiator;
the absence of arrears on taxes, levies, debts on other obligatory payments;
data on availability of sources of financing of activities under the concession agreement, and the confirmation for not less than 5 % of the total cost of the project.
Form partially establishes new requirements for the information proponent for the initiative, for example, information about presence/lack of project documentation, the estimated cost of the project, information on the use of innovative technologies.
The adoption of a single Form of the proposal will unify the initiators also provide information in relation to the initiative, thereby simplifying the preparation of the necessary initiator of a package of documents. However, when filling out the form the initiator can be a number of issues, some of which are described below.
Proposal form: open questions and guidelines for completing
Question: quotation Form provides for the indication of the initiator of the information about the availability of funds, or for not less than 5% of the amount stated in the draft concession agreement of investment (and marginal cost of production and (or) reconstruction of object of the concession agreement that concessionaire's expected, for each year of the term of the concession agreement). The provision of a document will be sufficient to confirm the availability of access to funds?
Recommendation: it Appears that for the purpose of confirming whether the initiator of the funds or the initiator can provide:
a preliminary agreement or agreement under the condition, concluded with the lender;
a letter to the credit of the organization's readiness to participate in the project proposed by the initiator;
confirmation of the availability of the initiator of participants (shareholders) or members of an ordinary partnership and a renewed commitment to their delivery to the initiator in case of signing of the concession agreement (e.g. a letter from the participants or shareholders ' agreement, which provides for the obligation of the parties to the proponent to provide funding in any form, provided by the legislation of the Russian Federation – contribution to share capital, loan).
However, to conclude, for example, a preliminary agreement or obtain a letter from the credit institution in the absence of documented agreements of the parties, in practice, difficult. Even more difficult it seems in the current market situation. In this case, it is optimal proof of own funds.
Question: proposal Form contains a section in which the initiator specifies the name of the person exercising the powers of the owner in respect of the object of concession agreement. How to understand who is the owner?
Recommendation: in order to understand who exercises the powers of the owner of property that is the subject of the concession agreement, to begin to determine which mandate is the conclusion of the planned agreement: municipal, regional or Federal (legislation on the delimitation of powers). Then it is necessary to analyze the property in terms of a industry sector: what is the object you plan to create? It is the object of social or transport infrastructure? Next, you need to look at the provision of the appropriate authority and to reveal his powers to the rights of the owner with respect to such property. For example, in respect of public roads of Federal importance the powers of the owner is implemented by the Federal road Agency.
Question: Item 5 of the form of proposal provided for specifying the initiator name of the authority exercising the powers of the owner in relation to the property which is the object of the concession agreement. However, the body exercising the powers of the owner in respect of the intended object of the agreement may not have the authority to conclude the concession agreement on behalf of the grantor. Is an obstacle to the conclusion of the concession agreement, the absence of the authority direct the authority to enter into concession agreements / implementation of the functions of the grantor?
Recommendation: the Ideal situation is when the position of the body carrying out powers of the proprietor concerning the property which will be the subject of a concession agreement also provides for powers of this body to act as the grantor. However, the practice of implementation of concession projects in Russia shows that not all the authorities exercising the powers of the owner, directly empowered to act as the grantor. Currently, for example, the Ministry of education and science of the Russian Federation, in accordance with his position, in unqualified concession agreements, despite the presence of the powers of an owner. In this case, the private initiator to issue a proposal for concluding a concession agreement in respect of educational facilities that are Federal property?
In paragraph 4.6. article 37 of the new edition of the Federal law "On concession agreements" lack the authority direct the authority to enter into concession agreements / implementation of the functions of the grantor are not listed as grounds for refusal to conclude the concession agreement. In this regard, there are no legal grounds for refusal to conclude the concession agreement for the specified reason. Therefore, the initiator may be recommended indication in the form of a person carrying out exactly the powers of the owner, and turning to him.
Question: quotation Form provides for the indication of the initiator of the address (location) the establishment and (or) reconstruction of object of concession agreement. How accurately you need to specify the location of the object of the concession agreement? How to complete item form, if the exact location of the object to create the agreement initiator is unknown? How to complete item form, if the land is not formed?
Recommendation: Questions regarding the location of the land, usually occur when an object of a concession agreement. In the case of the reconstruction of the object, the initiator specifies the address of the reconstructed object of real estate, for example, on the basis of information contained in the EGRP. Note that the error in the accuracy of addresses will not be an obstacle for the consideration of the potential grantor of the proposal.
If the object of a concession agreement is planned to establish the initiator in accordance with the plans of potential of the grantor, the initiator may not have information regarding the location of such a facility, which is especially important to create single objects and groups, for example, a network of boiler houses, toll booths, stopping points, etc. In this case, the initiator is recommended in the specified box on the form to provide information on the recommended placements of the object of concession agreement (for example, a specific address or coordinates).
For a number of projects relevant question is fill the specified paragraph form, if the land on which it is planned placement of the object, is formed. In this case, it is recommended to provide the coordinates of the plot (lat, LON, district, locality, etc.).
Question: the form of the sentence contains a reference to the period of the transfer by the grantor to the concessionaire object of the concession agreement and other property. As the initiator can calculate this time? Can the transfer date not be determined by a calendar date, and an indication of the occurrence of a specific event (for example, in the case of removing from encumbrance of the object)?
Recommendation: Since in this case we are talking about the potential obligations of the grantor, which will be laid later in the draft concession agreement, refer to the regulatory deadlines of such a "transfer" in the case when we are talking about registration of rights of possession and use of the concessionaire to this object. If we are talking about anonimamente, you need to understand who owns such property and on what right, ie that would mean the "transfer of rights" – the conclusion of the lease, uncompensated use. Also, if you specify the time period should be borne in mind, is properly the right to such property, or required within this period to lay the time on their appearance.